Logistics and supply chain management allows companies to do business with the world around them. Without logistics nothing, and we do mean nothing, would be possible. We need to transport goods freely and openly with the rest of the world or this whole thing comes to a screeching stop.

No more United Parcel Service (UPS) packages coming in the mail, 

 that are assembled in other parts of the world getting to one country from the other, and definitely no more Amazon (AMZN) packages.

No matter how you look at it, there is always something one country or region has that another may need. Take commerce between countries like the United States and 

 for a good example. In order to maintain the commerce of nations, as well as the people and businesses that operate within them, we need logistics that is as free of bottlenecks as we possibly can.

FedEx (FDX), DHL, as well as companies like XPO Logistics (XPO) provide one form of logistics services or another to make sure that ordinary life can continue for the rest of us. Nearly everything sitting within a 50 foot radius of you right now took part in some process of logistics, whether it was made in another country or another state.

It was most likely not assembled in your house, therefore, it had to be shipped to a place you could then buy it, or it was shipped directly from where you bought it from. Users of E-commerce platforms such as Shopify (SHOP) are acutely aware of how critical logistics is to their business.

Without the proper channels of logistics and supply chain management, they wouldn't be able to get their products to the end consumer. To put it simply, a lot of of people rely on a health supply chain, you could say we all do.

What Are Logistics and Supply Chain Management?

Think of logistics as the planning and the supply chain the flow of how that plan is cared out. What is the "plan," you may ask? The plan is to get the wide variety of goods that ship around the world from point A to point B without any mishaps, like lost packages.

Every package you get is made possible by a complex system of storage, transportation, and delivery coordinated by an equally complex network of administration and logistics management. From the time you place your order until it is in your hands, logistics helps determine your package’s timing, quality, and cost.

The term “supply chain” is better understood, so it’s helpful to think of logistics as a part of the supply chain. If the logistics—transportation, distribution, and brokerage—doesn’t allow goods and services to flow, then the supply chain is damaged.

Each stage of the logistics process—receiving the goods, warehousing and inventory, packaging and labeling, and delivering—has a value, which contributes to the final value of the delivered package. Parts of this retail value chain can be outsourced to service providers or vendors who help carry out the logistical steps that allow that package to appear at the front door at the right time—and even get returned or exchanged for a better item (1).

Logistics is a booming business, thanks in part to e-commerce. In 2022, the U.S. e-commerce sector is expected to hit the $1 trillion mark for the first time, even as retail sales overall have dropped. By 2026, the e-commerce market share is predicted to be $1.7 trillion—although businesses tasked with logistics management see continued challenges ahead (2).

The pandemic and world conflicts have shaken supply chains and driven up logistics costs. In 2021, transportation, warehousing, and support and administrative services like shipping and fulfillment cost businesses $1.85 trillion, a 22.4% increase from the year before (3). Businesses have been looking for new ways to keep up with consumer demand and not sink their budgets. Flexibility and resiliency are key—as is innovation.

Investors interested in this rapidly-growing sector look for funds that may include services and businesses like railroads, trucking companies and shippers, delivery and freight companies as well as supply chain software businesses and logistics management companies. 

technologies like artificial intelligence (AI)

 that can facilitate the movement, storage, and flow of goods, services, and information in ever more cost-effective ways.

Investing in logistics services and logistics innovation connects investors to diverse investments in retail markets, the global economy, and emerging industry technologies.

Thanks to the rise of e-commerce and industry giants like Amazon making same-day delivery mainstream, consumers demand a fast turnaround, with a two-day window (or less) a strong preference (4). People had been forgiving of long delays during the pandemic, but that tolerance has diminished sharply. 

Already by 2021, 80% of consumers were holding retailers to task for service disruptions. People wanted their purchases delivered reliably and on time, and they were willing to look elsewhere for the products, especially Gen-Xers and Millennials, who prefer making purchases online (5). 

One of the most valuable incentives for a buyer is the seller’s ability to get a product to a customer’s door quickly—and that is where logistics can make or break a company, now and into the future.

Worldwide, in 2021, the logistics industry was valued at $14.56 billion, and predicted to surge to $15.71 billion in 2022 and keep growing, to $18.69 billion by 2026. Behind this growth are developing countries, who have been increasing exports up to 30% between 2020 and 2021, with the Asia-Pacific region holding the lion’s share of the market (6).

More than 76% of the world’s trade transactions happen within the global supply chains (7), and as people around the world experienced during the past few years, supply shortages, conflicts, oil prices, shipping delays, and more can slow those transactions to a crawl.

Those in the logistics industry saw opportunity amid the challenges. Some companies diversified their partners and regions to begin working with intermodal shipping solutions, while most doubled-down on the use of technologies like AI and cloud-based systems, striving to make their processes more efficient up and down the value chain. 

It is not enough for existing processes merely to evolve with the times; in the future, outright disruption is going to be an essential component for recognizing and capturing savings.

, blockchain, and 3-D printing are technologies that are already transforming logistics with their potential to radically modernize how goods are moved from one place to another. The savings produced by technologies like these could be tremendous, as could the potential earnings for investors aligned with the company selling or implementing the technology.

Companies are recognizing that investing big in logistics is essential for maintaining a long-term competitive advantage. Amazon is investing $1 billion in companies working on issues with the supply chain and logistics (8). 

Private investment in logistics and supply chain technology soared to more than $24 billion in 2021, a 58% increase from 2020 and twice the amount invested in 2019 (9).

Logistics as an industry is centuries old. World events may have forced it to modernize at high speed, but the upsides of the disruption of the status quo are many. From making global trade easier and more accessible for everyone to saving time, money, and even carbon emissions, logistics keeps the global economy flowing.

How Can Magnifi Help You Invest in Logistics?

Investing in logistics is an opportunity to take part in an essential, growing industry that touches all global economies. Without it, the world's economy could not survive. For evidence to that point, simply need to remember the negative effects the COVID had on the logistics industry.

Using Magnifi as your own investing concierge, you can now ask for answers to questions like "How can I invest in logistics?," and be provided a long list of potential additions to your investment portfolio.

The best place to start when looking for logistics stocks is with your new AI investing app, Magnifi. Simply consulting with your AI investing assistant can create a list of options within a given industry, in this case, logistics.

Over a forecast period of 2022-2030, the logistics industry is predicted to grow by almost 7%, bringing the total market size to 16,01,196.16 million

What is the future of Logistics in next 10 years? 

Besides tremendous market growth, the logistics industry has new and improving technologies that are sure to improve the speed and efficiency of the entire industry. This means things get from point A to point B quicker and for a lower cost.

With the emergence of the internet and online retail, basically everything we need is shipped through various logistic solutions. The world would simply stop dead in its tracks if supply chains were disrupted, see the COVID pandemic for an example of what that looks like.

What should I look for while investing in Logistics stocks?

 How much do they ship in a given year? How many countries or customers do they service? Basically, your best bet is to look for companies that are on the top of their industry and monitoring them for good prices to buy at.

There are several, such as getting the entire logistics ecosystem back up and running from where it was left after the pandemic. However, another rapidly growing development is the use of drones in order to deliver packages, like those Amazon (AMZN) is currently testing.

“U.S. Retail Logistics Market Size, Share & Trends Analysis Report By Type, By Solution (Commerce Enablement, Supply Chain Solutions, Transportation Management), By Mode Of Transport, And Segment Forecasts, 2022 - 2030,” Grand View Research, accessed November 21, 2022, https://www.grandviewresearch.com/industry-analysis/us-retail-logistics-market-report

Davidkhanian, Suzy, “US Ecommerce Forecast 2022,” July 26, 2022, Insider Intelligence, https://www.insiderintelligence.com/content/us-ecommerce-forecast-2022

Solomon, Mark, “No surprise: Report finds logistics costs spiked in 2021,” June 21, 2022, Freightwaves.com, https://www.freightwaves.com/news/no-surprise-report-finds-logistics-costs-spiked-in-2021

Romaine, Ed, “20 Statistics that Show the Importance of Same-Day Delivery,” November 30, 2021, https://www.conveyco.com/blog/delivery-statistics/#:~:text=Nearly%20half%20of%20consumers%20said,to%20standard%20two%2Dday%20shipping

Consumers respond to waves of disruption: June 2022 Global Consumer Insights Pulse Survey,” June 2022, PwC, https://www.pwc.com/gx/en/industries/consumer-markets/consumer-insights-survey.html

“Freight And Logistics Global Market Report 2022,” September 14, 2022, GlobeNewswire, https://www.globenewswire.com/news-release/2022/09/14/2515639/0/en/Freight-And-Logistics-Global-Market-Report-2022.html

“Supply Chain Services,” International Trade Administration, accessed November 21, 2022, https://www.trade.gov/supply-chain-services

van Romburgh, Marlize, “Amazon Primes New $1B Fund To Invest In Companies Working On Logistics And Supply Chain Issues,” April 21, 2022, Nasdaq.com, https://www.nasdaq.com/articles/amazon-primes-new-$1b-fund-to-invest-in-companies-working-on-logistics-and-supply-chain

Pino, Dominic, “Private Supply-Chain Investment Soars,” February 8, 2022, National Review, https://www.nationalreview.com/corner/private-supply-chain-investment-soars/

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